What is Homeowner’s Insurance and What Does it

Cover?

Homeowner’s insurance provides financial coverage for any damage to your home and its contents in the event of a burglary or a fire. Aside from this, protection is provided if you or anyone living in the home is found liable for injuries to visitors and workers or loss of their property. If you are buying a home, keep in mind that many mortgage lenders require you to have insurance. Different types of policies are available for covering your home. These range from standard polices to policies that provide more protection. Depending on your state, you might not be in a position to get all coverages and policies. Standard policies do not cover floods and earthquakes, but you can have a policy custom made to fit your needs. What Does Homeowner's Insurance Cover? In order to know the type of policy you need, or have one tailored for you, it is important to know what can be covered by home owner’s insurance. Many standard homeowner’s policies provide the following; · Dwelling A standard policy can pay for the rebuild or repair of your home, which includes wiring, heating and air conditioning as well as plumbing that has been damaged due to a cause that is covered. Purchasing sufficient cover is advisable to ensure the cost of repair is fully covered. · Detached Structures Damage to detached structures such as fences, sheds, cottages and garages is covered in a standard policy. · Personal property You have a right to be compensated for personal items that may have been destroyed in your house by covered causes. These items include clothes, electronics, furniture and sporting gear among others. · Liability Insurance Homeowner’s insurance will safeguard your assets while covering legal expenses if you or a family member is being sued for causing damage and injuries to other people. · Loss of Use In the event you have to move out of your home for it to be restored, your policy covers additional living and housing expenses. This ensures that you do not pay out of pocket. Homeowner’s insurance is important when you have a mortgage. The lender will want to ensure that the property is protected. If you do not have insurance, your lender can purchase one for you. Keep in mind that it is the lender only who might be covered by the insurance, and it might be more expensive than you buying it on your own. There are some homeowners who choose to pay for their insurance as part of their mortgage payment. These payments are made to lenders, and they hold part of the insurance payment in escrow accounts. It is when the insurance bill is due that the lender pays it from your escrow account. In order to meet your insurance needs, there are additional home coverages you can include in your homeowner’s policy. This, however, will mean paying higher premiums for broader coverage. Stay informed when you are choosing your insurance and work with an insurance representative to tailor a homeowner’s insurance policy that is suitable for your budget and needs.
Copyright 2013 The Insurance Guide
The Insurance Guide
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